1. NON-LIFE INSURANCE

2. Non – Life Insurance According to Wikipedia
“Non-life Insurance or General Insurance policies, including automobile and homeowners policies, provide payments depending on the loss from a particular financial event.”
General insurance is typically defined as any insurance that is not determined to be life Insurance.

3. Non-Life Insurance Business
Marine Insurance
Fire Insurance
Miscellaneous Insurance
- Motor Insurance
- Burglary Insurance
- Personal Insurance
-Rural Insurance Policies

4. Types of Non-Life Insurance
Marine
Fire
Personal Accident
Motor
Rural
Burglary

5. Marine Insurance
Marine Insurance is concerned with overseas Trade. Marine Insurance may be called a contract whereby the insurer undertakes to indemnify the insured in a manner and to the extent thereby agreed upon against marine losses.

6. Defining Marine Insurance
Marine Insurance covers the loss or damage of ships, cargo, terminals, or any transport or cargo by which property is transferred, acquired, or held between the points of origin and final destination.

7. Marine Insurance has two Branches :
Ocean Marine Insurance
Inland Marine Insurance
Ocean Marine Insurance covers the of the sea whereas,
Inland Marine Insurance is related to the inland risks on the land
Perils – Cause of Risk and losses

8. Subject Matters to be Insured
The Marine Insurance may cover three types of things :
Cargo Insurance
Hull Insurance
Freight Insurance

9. Cargo Insurance
Cargo Insurance covers loss and/or damage of cargo while it is in transit between the points of origin and final destination.
The goods are generally insured according to their value but some percentage of profit can also be included in the value.
The Cargo policies may be Special, Reporting and Floating.

10. Cargo Insurance Special Policy is only for one Shipment.
Reporting or Open Cargo Policy covers all shipments made by an exporter over a long period of time.
Floating Policy is just similar to open Cargo policy but differs from it only in respect of the method of paying the premium.
- In Floating Policies the value of the future shipments is estimated and premium is deposited with the company.
- Later on, actual shipments are compared with the estimates and the premium is adjusted.

11. Hull Insurance
When the ship is insured against any type of danger it is called Hull Insurance.
The ship may be insured for a particular trip or for a particular period.

12. Freight Insurance
The shipping company has an interest in freight. The freight may be paid in advance or on the arrival of goods.
The shipping company will not get freight if the goods are lost during transit.
The shipping company may insure the freight to be received which is known as Freight Insurance.

13. Principles of Marine Insurance
1. Utmost Good Faith
2. Insurable Interest
3. Indemnity
4. Causa Proxima

14. Utmost Good Faith
Based on utmost good faith on the part of the parties.
Burden more on the insured than on the underwriter.
Insured should give full information about the subject to be insured.
If a party does act in good faith, the other party is at liberty to cancel the contract.

15. 2. Insurable Interest
Insurable Interest means that the insured should have interest in the subject when it is to be insured.
He should be benefitted by the safe arrival of commodities and he should be prejudiced by loss or damage of goods.
The Insured may not have an insurable interest at the time of acquiring a marine insurance policy, but he should have a reasonable interest at the time of loss of damage, otherwise he will not be able to claim compensation.

16. 3. Indemnity
Insured will be compensated only to the extent of loss suffered. He will not be allowed to earn profit from Marine Insurance.
The insurer undertakes to make good the loss.
Under this principle the insurer agrees to compensate the insured for the actual loss suffered.
The money value of the subject-matter is decided at the time of taking up the policy. But sometime the value if calculated at the time of loss also.
Exception :
Some profit of margin is also allowed to be included in the value of the goods.
The assumption is that the insured will earn profit when goods reach at their destination.

17. 4. Causa Proxima
This is a Latin word which means the nearest or proximate cause. It helps in deciding the actual cause of loss when a number of causes have contributed to the loss.
The immediate cause of loss should be determined to fix the responsibility of the insurer.
If the proximate cause is the one which is insured against, the insurance company is bound to pay the compensation and vice-versa.

18. Marine Insurance Policy
A Marine Insurance Policy generally contains the following in formation:
1. Name of insured or his agent
2. Subject matter insured. It may be ship, cargos and freight.
3. Risks Insured against
4. Name of vessel and offices
5. Description of Voyage or period of insurance
6. Amount and term of insurance
7. Premium

19. Kinds of Marine Policies
Voyage Policy
Time Policy
Mixed Policy
Valued Policy
Unvalued Policy
Floating Policy
Block Policy
Composite Policy
Fleet Policy
Port Policy

20. 1. Voyage Policy
It covers the risk from the port of departure up to the port of arrival.
The policy ends when the ship reaches the port of arrival.
This type of policy is purchased generally for cargo.
The risk coverage starts when the ship leaves the port of departure.

21. 2. Time Policy
A Time policy is the one that runs for a period of time usually not exceeding 12months.
Suitable for full insurance.
Generally issued for one year.
In India, a time policy is not Issued for more than a year.
Time policies may sometimes be issued for more than a year or they may be extended beyond a year to enable a ship to complete a voyage.

22. 3. Mixed Policy
This is a policy that covers the subject matter for the voyage within a time period.
It is used to cover the cargo from warehouse to warehouse with a time limit.
These Policies are issued to ships operating on a particular route.

23. 4. Valued Policy
The value of the policy is decided at the time of contract. The value is written on the face of the policy.
In case of loss, the agreed amount will be paid. There is no dispute later on for determining the value of compensation.
The value of the goods includes cost, freight, insurance charges,, some margin of profit and other incidental expenses.

24. 5. Unvalued OR Open Policy
When the value of insurance policy is not decided at the time of taking up a policy, it is called Unvalued Policy.
At the time of loss or damage the value of the subject-matter is determined.
In finding out the value of goods, freight, insurable charges and some margin of profit is allowed to the policy in common use.

25. 6. Floating Policy
Floating policy is taken for a relatively large sum by the regular suppliers of goods.
It covers several shipments which are declared afterwards along with other particulars.
The Floating policy is just similar to open cargo policy but differs from it only in respect of the method of paying the premium.
This policy is most situated to exporter in order to avoid trouble of taking out a separate policy for every shipment.

26. 7. Block Policy
Sometimes a policy is issued to cover both land and sea risks.
If the goods are sent by rail or by truck to the port of departure, then it will involve risk on land also.
One single policy can be issued to cover risks from the point of despatch to the point of ultimate arrival.

27. 8. Composite Policy
This type of policy is purchased from more than one underwriters.
If there is no any motive of fraud then insured will be indemnified by each under writer separately in case of loss.

28. 9. Fleet Policy
A policy may be taken up for one ship or for the whole fleet. If it is taken for each ship, it is called as single vessel policy.
When a company purchases one policy for all its ships, it is called a fleet policy.
The insured has an advantage of covering even old ships at an average rate of premium.
This policy is generally a Time Policy.

29. 10. Port Policy
It covers the risks when a ship is anchored in a port.

30. Clauses in a Marine Insurance Policy
Valuation Clause
‘At and From’ Clause
Sue and Labour Clause
Warehouse to Warehouse Clause
Change of Voyage
Touch and Stay Clause
Inchmaree Clause
Jettison
Memorandum Clause

31. 1. Valuation Clause
This clause states the value of the subject matter insured as agreed upon between both the parties.
In case of loss or damage the compensation will not exceed the amount given in the policy.

32. 2. ‘At and From’ Clause
This clause covers the subject matter while it is lying at the port of departure and until it reaches the port of destination.
It is used in voyage policies. If the policy consists of the word ‘from’ only instead of ‘at and from’, the risk is covered only from the time of departure of the ship.

33. 3. Sue and Labour Clause
This clause authorizes the insured to take all possible steps to avert or minimize the loss or to protect the subject matter insured in case of danger.
The insurer is liable to pay the expenses, if any, incurred by the insured for this purpose.

34. 4. Warehouse to Warehouse Clause
This clause is inserted to cover the risks to goods from the time they are dispatched from the consignor’s warehouse until their delivery at the consignee’s warehouse at the port of destination.
This clause saves the shipper from lot of troubles and he is sure of the safe arrival of the subject-matter not only at the port but also at the warehouse.

35. 5. Change of Voyage
Where, after attachment of this insurance, the destination is changed by the Assured, held covered at a premium and on conditions to be arranged subject to prompt notice being given to the Underwriters.

36. 6. Touch and Stay Clause
This clause requires the ship to touch and stay at such ports and in such order as specified in the policy.
Any departure from the route mentioned in the policy or the ordinary trade route followed will be considered as deviation unless such departure is essential to save the ship or the lives on board in an emergency.

37. 7. Inchmaree Clause
This clause covers the loss or damage caused to the ship or machinery by the negligence of the master of the ship as well as by explosives or latent defect in the machinery or the hull.
This clause was inserted after a famous case involving a ship named ‘Inchmaree’ in 1857.

38. 8. Jettison
Jettison means throwing overboard a part of the ship’s cargo so as to reduce her weight or to save other goods.
This clause covers the loss arising out of such throwing of goods.
The owner of jettisoned goods is compensated by all interested parties.

39. 9. Memorandum Clause
Sometimes Perishable goods are the subject-matter of insurance. The memorandum Clause is used to save the insurer from paying small losses of perishable foods.
Under this clause the insurer is not liable for partial losses.

40. Marine Losses
Marine losses arise due to various parts. Marine Insurance policy does not cover all the parts being faced.
An insurer specifies the policy against which the loss will be compensated.
If a peril causing a loss was not covered in the policy then the insured will have to bear the loss.

41. Marine Perils Perils of Sea:
Refers to fortuitous accidents or casualties of the sea
i. Ordinary action of the winds and waves.
ii. Ordinary wear an tear to the vessel
iii. Inherent Risk of the Cargo
are not included.
Fire :
Damage resulting from fire, water used for extinguishing the fire are included.

42. Marine Perils Enemies :
The ships belonging to the foe may cause loss to the insured.
- This policy extends to all the persons of the enemy country and to their hostile acts provided such acts form part of the enemy actions.
Jettison :
Means voluntary throwing away a part of the cargo or an equipment of the ship for lightning the weight of the ship for common safety

43. Marine Perils 5. Barratry :
Includes every wrongful act willfully committed by the master or the crew.
- Theft, setting of fire to ship, fraudulent selling of vessel and cargo
Man-of-War :
This is the vessel which is authorized by nations for the purpose of defence or attack in the event of hostilities.

44. Classification of Marine Losses
1. Total Losses
i. Actual Total Loss
ii. Constructive Total Loss
2. Partial Losses
i. Particular Average Loss
ii. General Average Loss

45. 1. Total Loss The Total Loss is divided into two Categories :
i. Actual Total Loss
ii. Constructive Loss

46. i. Actual Total Loss
Actual Total Loss occurs under the following situations :
The insured cargo is physically destroyed such that there is no possibility of salvage or recovery of the goods.
The insured cargo is damaged that it ceases to be a thing or description insured. E.g. cement bag turns into concrete due to sea-water contact.
The cargo is irretrievably lost. For example, when the ship sinks, the cargo can be retrieved only after a long time and the salvaged goods cannot be of any value to the insured.

47. ii. Constructive Total Loss
This occurs when the ship is abandoned for certain reasons.
It can take place when the cargo is damaged to such an extent that the const of saving and repairing or reconditioning of the goods is more than the value of the goods.

48. 2. Partial Loss The Partial Loss is divided into two categories:
i. Particular Average Loss
ii. General Average Loss

49. i. Particular Average Loss
A partial loss of subject matter insured, caused by a peril insured against, and which is not general average loss.
Not caused Voluntarily.
The insured subject-matter should be damaged and this damage should be caused by marine peril which is insured.

50. ii. General Average Loss
A general average loss is caused voluntarily to avoid an impending danger.
It is the one which is caused by an extra-ordinary sacrifice or expenditure voluntarily and reasonably made.
Conditions:
An extra-ordinary situation
Peril must be real and not imaginary
Loss must be voluntary and deliberate
Sacrifice must be made prudently
Purpose should be to save the whole adventure
Act should be successful at least partially

51. Payments of Claims under Marine Insurance
For making a claim under marine insurance following steps are taken:
1.Evidence
2. Notice of Claim
3. Documents Required for Claim
4. Extent of Liability

52. Fire Insurance
Fire Insurance is a form of property insurance which protects people from the costs incurred by fire.
It goes beyond property insurance and covers:
i. The cost of reconstruction
ii. The cost of replacement
iii. The cost of repair

53. Fire Insurance The term ‘fire’ must satisfy two conditions :
a) There must be actual fire or ignition
b) The fire should be accidental.
The insurer is liable to the actual amount of loss not exceeding the maximum amount fixed under the policy.

54. Elements of Fire Insurance Contract
Proposal:
- Proposal can be made either verbally or in writing.
- Description of the property to be insured is given
- Observe Utmost Good Faith
Acceptance:
- The insurer will assess the risk on receipt of proposal.
Commencement of Risk:
- The risk commences irrespective of the fact that no policy has been issued and no premium has been paid.

55. Procedure for Fire Insurance
Whenever a person or a business house wants to get its property insured, a proposal form is duly filled.
The details of property, its location and contents are given in the proposal.
Fire insurance contract is based on mutual faith.
The proposal may be accepted on its receipt or a surveyor may be sent to assess the proposal.
When the underwriter accepts the proposal, the contract comes into existence.
A fire insurance policy is issued for one year but it may be periodically reviewed.
The insured can get it renewed within the grace period and insurance coverage continues in the mean time.

56. Fire Insurance Policies
Factors that are to be considered before deciding about the kinds of policies to be taken are :
The type of Risk involved
The nature of property to be insured
The contents of the property
Occupancy hazards
Exposure Hazards
The time Element

57. Kinds of Fire Insurance Policies
Valued Policy
Specific Policy
Average Policy
Floating Policy
Comprehensive Policy
Consequential Loss Policy
Replacement Policy

58. 1. Valued Policy
In this type of policy, the value of commodity is already set and actual loss is not taken into consideration.
The principle of indemnity if not applicable to this policy.
The agreed value may be more or less than the market value at the time of loss.

59. 2. Specific Policy
In this type of policy, the insurance company is liable to pay a sum, which may be less than the property’s real value.
The insured is called to bear a part of the loss, as the actual value of the property is not considered in deciding the amount of indemnity.

60. 3. Average Policy
If a ‘Average Clause’ is applicable to any policy, it is called Average Policy.
Average Clause if added to penalise the insured for taking up a policy for a lesser sum than the value of the property.

61. 4. Floating Policy
A Floating Policy is taken up to cover the risk of goods lying at different places.
This type of Policy is subject to average clause and the extent of coverage expands to different properties, belonging to the policy holder, under the same contract and one premium.

62. 5. Comprehensive Policy
Known as ‘all-in-one’ Policy, the insurance company indemnifies the policy holder for loss arising out of fire, theft, burglary and third party risks.
In this policy, the policy holder also gets paid for loss of profits incurred due to fire, till the time the business remains shut.

63. 6. Consequential Loss Policy
Fire may dislocate work in the factory.
A policy may be taken up to cover up consequential loss or loss of profits.
A separate policy may be taken up for standing charges also.

64. 7. Replacement Policy
As per Replacement policy, the insurance company instead of paying the policy holder the amount of indemnity in cash, replaces the damaged property with a new one.

65. Payment of Claim Under Fire Insurance
1. Information about loss
2. Appointment of Assessor
3. Checking of Documents
4. Issue of Claim Form

66. Motor Insurance
Motor Insurance is insurance purchased for cars, trucks, and other vehicles. Its primary use is to provide protection against losses incurred as a result of traffic accidents and against liability that could be incurred in an accident.

67. Liabilities Requiring Compulsory Insurance
Liabilities arising in respect of damage to any property of a third party
Liabilities arising in respect of death or body injury of any passenger of a public service vehicle.
Any liability arising by the insured in respect of death or bodily injury of any person including owner of goods.
Liability arising under Workmen’s Compensation Act in respect of death or bodily injury of paid driver
Liability in respect of death or bodily injury of passengers

68. Motor Insurance Polices
1. Act Only Policy
2. Third Party Policy
3. Comprehensive Policy

69. 1. Act Only Policy Policy is compulsory under Motor Vehicle Act.
In this policy the risk of injury to third party’s body and property is included here.
The amount or policy is fixed by the Act.

70. 2. Third Party Policy
This policy covers all risks mentioned in Motor Vehicle Act.
The insurer on behalf of the insured liability pays all sums of liability, costs and expenses which insured becomes liable.
The policy aims to protect the insured against liability to others for accidental death or personal injuries.

71. 3. Comprehensive Policy
This policy covers all risks to insured arising out of legal liability i.e. to third parties under Motor Vehicles Act, Total Accident Act and Common Law.
It covers all risks mentioned in form as provided in Private Car Tariff.

72. Settlement of Claims in Motor Insurance
1. Receipts of Claim Intimation
2. Entering in Claim Register
3. Claim Form
4. Quantum Of Damage

73. Burglary Insurance
Insurance provided against the damage in one’s residence as a result of burglary, theft, dacrity, house-breaking etc.
It provides financial compensation against loss or damage to property contained in your premises

74. Burglary Insurance Policies
Private Dwelling Burglary Policy
Business Premises Burglary Policy
Policy for Money-in-Transit
Legal Opinion
Inspection of Claim
Settlement of Claim

75. 1. Private Dwelling Burglary
In such policies owner’s or occupier’s personal belongings, personal effects, property article, jewelry, ornaments etc. are secured against the risk of theft, dacoit, burglary, house-breaking etc.
The residential house to be insured should not remain vacant for more than 60days in a year.

76. 2. Business Premises Burglary Policy
It covers :
Personal assets and properties of the insured.
Articles of decorations and display in the business premises
Goods or property in the contract of bailment, trust, etc.
Valuable and cash kept in the locked safe
Stock in trade lying in the business premises or godowns of the business premises

77. 3. Policy for Money-in-Transit
Under this policy insurance company agrees to indemnify the losses of cash, postal orders, bank drafts, cheques, money orders stamps and bills of exchange of the insured while in transit.

78. 4. Legal Opinion
Legal Opinion about the case is obtained by the company. If necessary, it may file compromise petition if there is negligence on the part of the driver or he is convicted on some charges.

79. 5. Inspection of Claim
After the receipt of claim form, there is an inspection of the claim through surveyors or investigators to find out the truth in the cases.
The causes of accident or loss, loss to be indemnified by the company, ultimate liability of the insurer are determined by the investigators.

80. 6. Settlement of Claim
On the basis of report submitted by the surveyor or investigator the extent of its liability and the loss is indemnified.
After getting a satisfaction report about repair from the insured, the company makes payment to the repairer.

81. Personal Accident Insurance
Personal Accident Insurance is one of the popular class of miscellaneous insurance and is supplement to life insurance.
Provides a better protection against death or disability.

82. Personal Accident Policies
Personal Accident and Specifies Disease Insurance:
- Insurance which is provided for disablement arising out of specified diseases
2. Medical Benefits and Hospitalization Schemes:
- Such policies help employees in reimbursing the medical and hospitability expenses of the employers whenever they use such services.

83. Rural Insurance
Insurance companies are bringing out policies for rural people in meeting growing risks in their areas.

84. Rural Insurance Policies
Janta Personal Accident Insurance
Group Personal Accident Insurance
Livestock Insurance
Crop Insurance

85. 1. Janta Personal Accident Insurance
Personal Accident Policy
Meant for Low income Groups
Covers risks such as death due to accident, permanent total disablement, loss of one eye or one limb, loss of two limbs etc.
The policy is insured for a sum of Rupees
Policy can be taken for a maximum period of 15years and maximum sum of rupees 10Lakhs.

86. 2. Group Personal Accident
A single group accident policy covering homogenous group of person is called Group Personal Accident Insurance.
The benefits are Rupees at the time of death or permanent disability due to accident.

87. 3. Livestock Insurance It includes all animals kept for use of profit.
Under this, the insurance company agrees to indemnify the loss caused to the owner by the death of livestock.

88. 4. Crop Insurance
It is a devise under which insurance company agrees to indemnify the loss caused due to the occurrence of uncertain events, to the standing crops of farmers.

89. Procedure for getting Non-Life Insurance Policy
Who can Insure
Documents Required for Taking a Policy
Warranties
Construction of Policies
Duration of the Contract
Alterations in Non-Life Policies
Assignment
Termination of Contract

90. Procedure Who can Insure:
Only those persons who have insurable interest in the subject matter of insurance can obtain this policy. Following may take up policy:
- Absolute owner of property
- Wife can insure property of her husband and vice versa till such time they are living together.
- 1/64 th owner of a ship can insure ship up to his interest in the ship.
- A person can insure his life as he has unlimited interest in his life.
- Somebody may be authorised to take up a policy under some statute.

91. Procedure… Documents Required for taking a policy:
Following documents are required for a non-life policy:
a. Proposal
b. Cover Note
c. Certificate of Insurance
d. Policy
Warranties:
- In addition to implied and express conditions, there may be certain express warranties incorporated in a non-life policy.
- It may be attached to a policy to ensure that risk remains the same throughout the period of the policy.

92. Procedure.. 4. Construction of Policies:
- In order to avoid misunderstanding and disputes the policies should be framed properly.
- Intentions should be clearly incorporated in the policy
Duration of the contract:
- Non-life policies can be Long-term or short-term polices
Alterations in Non-Life Policies:
- The conditions inserted in the policy are not altered.

93. Procedure.. Assignment:
- An assignment is the passing of interest in property or a right from one person to another when a policy cover specifies property or liability arising from the possession of such property.
Termination of Contract:
- A policy remains in force up to the end of its expiry.
- But it may terminate before expiry under certain circumstances.

94. Procedure.. Refund of Premium:
- Premium once paid cannot be refunded by the insurance company
- But it may be refunded in full if the contract ultravires.

95. Difference Between Basis Life Insurance General Insurance
1. Nature of Risk
- Risk is Certain
Risk is not Certain
2. Object
- Object is to secure future and also make investment.
- Object is to get security or compensation in the event of loss or damage.
3. Time Period
- The policy is generally for a longer period.
- The policy is gradually for one year.
4. Premium
- The amount of premium is linked to the age of the insured and period to the policy.
- Premium is fixed as per the nature of risk involved.
5. Insurable Interest
- Insurable interest must exist at the time of acquiring policy.
- Insurable interest must exist at the time of contract and also at the time of loss but in nature marine insurance it must exist at the time of loss.

96. Difference Between Basis Life Insurance General Insurance
6. Compensation
- A fixed amount of money is paid on loss of life and the loss is not compensated.
- The loss is compensated in general insurance.
7. Surrender of Policy
- The policy can be surrendered before its maturity.
- General Insurance policies cannot be surrendered.
8. Moral Obligation
- There is no more Obligation to protect the insured.
- In case of fire, there is an obligation to protect the goods insured. The loss should be accidental and not international. In Marine Insurance, there is no moral obligations since goods are on the sea.
9. Payment of Premium
- The premium is paid in installments.
- The amount of premium is paid in lump sum.

97. ANY DOUBTS??

98. THANKYOU